Intel Corporation has been awarded up to $3.5 billion in federal grants to produce advanced semiconductors for the Pentagon under the Secure Enclave program. The initiative aims to develop military-grade chips in several states, including Arizona, and is part of broader efforts to reduce reliance on foreign manufacturers.
The grant follows previous funding announcements for Intel, which is set to receive as much as $8.5 billion in grants and $11 billion in loans from the Chips and Science Act. This new program highlights the government’s trust in Intel despite its recent financial struggles. Intel is still negotiating terms for its broader incentive package, including facilities in Ohio, New Mexico, and Oregon.
The Pentagon’s decision to choose Intel reflects limited options, as it is the only US manufacturer of advanced processors. Other semiconductor makers, such as Taiwan Semiconductor Manufacturing Co. and Samsung, have also received US support to build facilities, but they remain foreign-based companies.
While the specific chip models to be produced for the Pentagon are unknown, the Secure Enclave program marks a significant commitment by the US government to bolster its semiconductor industry. Intel continues to seek further contracts and has invited other tech companies to explore using its chip facilities.
The European Commission has approved Poland’s plan to provide Intel with more than 7.4 billion zlotys ($1.91 billion) in state aid to support the development of a new chip assembly and testing plant. This significant investment aligns with the EU’s Chips Act, which aims to increase Europe’s share of the global chip market to 20% by 2030. Intel intends to invest up to $4.6 billion in the facility near Wroclaw, Poland, and it is expected to boost economic growth and technological advancement in the region.
Poland’s Deputy Prime Minister Krzysztof Gawkowski confirmed that the aid package would span 2024-2026, while additional legislation is required before finalising the deal. The government expects the process to be completed by the end of this year, enabling construction to begin soon after. This investment represents the largest of its kind in Poland in decades, promising to strengthen its economy and technological sector.
Meanwhile, Intel is also pursuing a $33 billion chip manufacturing project in Germany, but this venture has faced delays. Despite Intel’s ongoing cost-cutting efforts, Polish officials remain confident that their country’s investment plans with Intel will proceed as scheduled. This partnership is seen as a critical step toward securing Poland’s role in the global semiconductor supply chain and attracting further high-tech investments.
The US government is reportedly considering allowing Nvidia to export advanced AI chips to Saudi Arabia. These chips would assist the kingdom in developing and operating cutting-edge models. The move could play a crucial role in Saudi Arabia’s AI strategy, which was a key focus at the recent GAIN summit.
Efforts are underway in Saudi Arabia to meet US security requirements, which could expedite the acquisition of Nvidia’s H200 chips. These chips are expected to boost Saudi Arabia’s capabilities, as they are also used in advanced platforms like OpenAI’s GPT-4. Saudi officials have expressed their intention to comply with US regulations.
The Biden administration had imposed restrictions on AI chip exports, particularly targeting China, but also extending to the UAE and other Middle Eastern countries. However, Saudi Arabia has been careful to manage its relationship with both the US and China, ensuring access to key technologies remains open.
Nvidia and the US Department of Commerce declined to comment on the potential chip sales. The Department of Commerce noted that export control decisions involve multiple government departments, including Defense, State, and Energy.
A significant $1 billion investment has been announced by NXP Semiconductors in India, aimed at doubling its research and development efforts. The company is betting on India’s growing importance in the semiconductor industry, aiming to strengthen its presence in the market.
CEO Kurt Sievers confirmed the plan during the Semicon India conference near New Delhi. The company is already in talks with key industries, including the automotive sector, and operates four design centres in India employing about 3,000 people.
Global giants like Nvidia and AMD have also increased their investments in India, reflecting the country’s growing role in reducing reliance on semiconductor hubs like China and Taiwan. India is also preparing an 85,000-strong workforce to support its ambitions.
The Dutch government announced on Tuesday that ASML will now require a licence to supply spare parts and software updates for chipmaking equipment previously sold to Chinese customers. This applies to equipment that has since been classified under new export restrictions.
The move follows the government’s decision last Friday to add two additional chipmaking tools to its national control list, aligning its policies with the United States. The restrictions aim to curb the export of advanced technology to China.
ASML, a major supplier of semiconductor manufacturing equipment, has previously expressed concerns over the potential impact of such restrictions on its business. However, the company must now comply with the new rules for sales to Chinese clients.
The Netherlands Foreign Ministry confirmed the updated regulations, stating that the licences will help control the flow of sensitive technology in line with international agreements.
China has expressed dissatisfaction with the Dutch government’s decision to extend export controls on ASML’s chipmaking equipment. The Dutch government announced it would expand licensing requirements on ASML’s 1970i and 1980i DUV lithography machines, aligning its policies with the US export restrictions introduced last year.
China has criticised Washington’s efforts to pressure allies like the Netherlands and Japan to impose restrictions that limit Chinese access to advanced semiconductor technologies. Beijing described the move as part of the United States strategy to maintain global dominance and strongly opposed the measures.
In its statement, China urged the Netherlands to avoid abusing export controls, emphasising that such actions could harm Sino-Dutch cooperation in the semiconductor sector and damage business interests on both sides. Dutch Trade Minister Reinette Klever defended the decision, saying it was made in the interest of safety.
The Dutch restrictions have effectively blocked ASML, the world’s largest chipmaking equipment supplier, from sending its most advanced lithography systems to China, impacting China’s ability to produce cutting-edge semiconductors.
The Dutch government announced on Friday that it will expand export licensing requirements for some of ASML’s semiconductor tools, bringing regulatory control back from the United States. The move aligns Dutch policy with the US and eases tensions between the two governments.
The licensing change comes amid ongoing efforts to restrict China‘s access to advanced technology. ASML, the Dutch company that produces the specialised lithography machines, does not anticipate that the policy shift will affect its earnings.
Dutch Trade Minister Reinette Klever emphasised the decision was made for national safety reasons, citing increased technological risks. ASML’s mid-range tools, such as the 1970i and 1980i DUV immersion lithography machines, are the focus of the new rules.
While the Netherlands has historically banned the export of ASML’s most advanced machines to China under the United States‘ pressure, recent US actions added further restrictions on ASML’s mid-range tools. Dutch lawmakers had expressed concerns about their country’s sovereignty under U.S.-driven policies.
A South Korean executive, Choi Jinseog, has been re-detained on new charges related to the theft of semiconductor technology developed by Samsung Electronics. The Seoul Central District Court issued a warrant on Thursday, citing concerns that Choi, who previously faced similar allegations, might flee.
Choi had already been under scrutiny since July 2023 for allegedly stealing information to build a copycat chip factory in China. He was arrested and released on bail last November but denies all charges. The latest allegations involve information theft about 20-nanometre DRAM chip processing technology. Choi’s lawyer maintains that the information in question is publicly accessible and that Choi has not been formally indicted on these new charges.
Why does this matter?
The case highlights South Korea’s ongoing efforts to combat industrial espionage and curb China’s advancements in chip manufacturing. Samsung declined to comment on the latest developments.
The US Senate Permanent Subcommittee on Investigations will hold a hearing on Tuesday to examine the use of American-manufactured semiconductors in Russian weapons deployed in Ukraine. The hearing will feature executives from Analog Devices, Advanced Micro Devices (AMD), Intel, and Texas Instruments, who will address concerns about their products being found in Russian military equipment despite US export controls.
Senator Richard Blumenthal, who chairs the panel, has expressed concerns that US semiconductor manufacturers need to enhance efforts to prevent their chips from being misused by the Russian military. The investigation follows reports indicating that US-origin technology, including chips used in various weapons and military equipment, continues to appear on the battlefield.
Intel, AMD, Texas Instruments, and Analog Devices are sending vice presidents responsible for trade compliance to testify. The companies have stated their commitment to complying with export controls and combating illicit diversion of their products, though the effectiveness of these measures will be scrutinised during the hearing.
Israel’s Tower Semiconductor and India’s Adani Group will invest $10 billion (839.47 billion rupees) in a semiconductor project in Maharashtra, India. That investment aligns with India’s efforts to boost its semiconductor manufacturing capabilities, despite previous setbacks such as Foxconn’s withdrawal from a major joint venture and delays in another semiconductor project.
The new plant in Maharashtra will initially produce 40,000 wafers and is part of a broader initiative by Indian Prime Minister Narendra Modi to establish the country as a global chipmaker. The state of Maharashtra also announced additional investments totalling 1.17 trillion rupees, which will create 29,000 jobs. This includes new electric vehicle manufacturing units, with Skoda-Volkswagen and Toyota-Kirloskar investing significant amounts to produce electric and hybrid vehicles.
Why does this matter?
The semiconductor and electric vehicle manufacturing expansion reflects India’s growing role in these sectors, aiming to capitalize on its rapidly developing technology landscape.
